Ukraine Resists Economic Union

Gorbachev hopes the treaty will boost the economy, but not all republics are on board

By
Justin Burke, Special to The Christian Science Monitor /
October 21, 1991

MOSCOW

AFTER numerous delays and disagreements, eight Soviet republics have signed a treaty to form an economic community, and a revamped national parliament is holding its first session.Soviet President Mikhail Gorbachev hopes the new structures will lead to the formation of a political confederation of republics and help create conditions for the country's economic revival. But the reluctance of several republics to participate in the new bodies, most notably the Ukraine, is casting doubt on Mr. Gorbachev's plans. The Ukraine, the second most powerful republic after Russia, is staying away from the new structures out of concern that they seek "to reanimate the old imperial union," says Deputy Ukrainian Prime Minister Konstantin Masik. The republic has not named representatives to the national Supreme Soviet, or parliament, which opened today. In addition, Ukrainian officials are refusing to sign the economic pact, at least for the time being, complaining their suggested amendments were not given proper considerati on. Given the Ukrainian stance, many Russian lawmakers are pessimistic about the economic pact's chances for success. They say the Ukraine's participation in an economic union is vital to stabilize the Soviet economy. "I'm afraid it'll turn out to be only a piece of paper," says the Rev. Gleb Yakunin, a Russian parliament member and Russian Orthodox priest. "We should concentrate all our attention on solving the economic problems here in Russia." Russian President Boris Yeltsin says harsh measures are necessary to end the republic's economic slide. With winter approaching and the people's patience wearing thin, Mr. Yeltsin announced Russia will soon launch drastic reforms, including the liberalization of prices. "The people will suffer, but we have to go through this," he said. But Yeltsin so far has no one to implement the reforms. The republic does not have a prime minister and its government is in disarray. Yeltsin has said he will soon form a government of "national unity" and appoint a premier, but few qualified candidates are willing to take the job. "Becoming prime minister at this time means [political] suicide. We must find someone with the courage to do what's in the nation's best interests," said Russian legislator Igor Nikulin. "So far, such a person has not come forward." "Yeltsin can start reform, but he can't see it through to the end on his own," added Alexander Penyagin, a Russian deputy in the national parliament. The economic cooperation pact is no less problematic. The three-year accord was initialed Oct. 1 at a meeting attended by all 12 remaining Soviet republics in Alma-Ata, the capital of Kazakhstan. However, the formal signing was delayed until last Friday as republics haggled over specifics, including centralized banking and finance structures. In the end, only eight republics signed the agreement in the Kremlin. Despite the absence of the Ukraine, Azerbaijan, Georgia, and Moldavia, Gorbachev said "the ice has been broken," and expressed confidence the four reluctant republics would eventually join the treaty. The Ukraine, Georgia, and Moldavia say they want to join the cooperation agreement, but the scenario for signing is not as simple as Gorbachev projects. Ukrainian officials, for example, say they need more time to analyze the treaty. Mr. Masik, the deputy prime minister, also said the republic wants to conclude bilateral economic agreements with each republic before joining the all-union pact - a process that could take months. "We're going to use all our strength to find a way so that the Ukraine will join the agreement," Masik said, "but it shouldn't contradict the interests of the people and the government of the Ukraine." Even if the Ukraine's objections are overcome, about 20 supplementary agreements must be negotiated before the cooperation treaty fully takes effect. Specific banking provisions promise to be especially difficult to hammer out, says Russian parliament member Albert Kamenev. "We have to take into account the share of capital that will be placed by the individual republics in the centralized banking system," Mr. Kamenev says. "If Russia gives 100 billion rubles and Armenia 10 billion, then Russia should have 10 votes and Armenia one," he continued. "Naturally, the smaller republics want equal representation because that would benefit them." A supplementary agreement on the thorny issue of republican currencies also must be negotiated. The Ukraine, Byelorussia, and Russia have announced a desire to issue their own money. But the introduction of new currencies must not undermine the ruble, which will remain the union standard, according to the cooperation treaty. The Supreme Soviet does not appear to be in much better shape than the economic treaty. Besides the Ukraine, three other republics were not expected to participate in the opening session. "It's hard to say how effective the Supreme Soviet will be," said Kazakhstan deputy Nigmet Zhotabayev. "The Ukraine is an important republic and its participation is needed."